From ToEE

Paladins have an innate ability to detect evil, however, it should be noted that this is limited. GaryGygax has the following to say in the DungeonMastersGuide (1st Ed, page 60):

Detection of Evil and/or Good

It is important to make a distinction between character alignment and some powerful force of evil or good when this detection function is considered. In general, only a know alignment spell will determine the evil or good a character holds within. It must be a great evil or a strong good to be detected. Characters who are very strongly aligned, do not stray from their faith, and who are of relatively high level (at least 8th or higher) might radiate evil or good if they are intent upon appropriate actions. Powerful monsters such as demons, devils, ki-rin and the like will send forth emanations of their evil or good. Aligned undead must radiate evil, for it is this power and negative force which enables them to continue existing. Note that none of these emanations are noticable without magical detection.

As such, Paladins cannot simply concentrate on a regular creature to see if it's evil. It may be evil, but may not be evil enough for the Paladin to notice.